Last week we learned that housing prices grew rapidly yet again in January.
The widely followed S&P CoreLogic 20-City Home Price Index was up 19.1% compared with January of last year — a blistering pace, especially considering that the growth was on top of the 11%-plus growth rate reported for January 2021.
In the chart below, you can see the acceleration in prices that has occurred over the past year and a half. The growth rates we are now seeing exceed those immediately preceding the Great Financial Crisis.
That’s enough to make anyone a little nervous, especially now that mortgage rates have risen to nearly 5% from a low of around 2.7%.
But there is one big difference between today’s bull market in housing and the one that ended so badly more than a decade ago. Generally speaking, we are not seeing the kind of speculation that was so rampant back then.
